RIYADH: Natural gas traders are preparing for market disruptions after Qatar announced that the complex housing the world’s largest liquefied natural gas facility had suffered “widespread damage” following several Iranian strikes.
QatarEnergy said in a statement on Thursday that several LNG facilities at the Ras Laffan site, which typically produce around a fifth of global supplies, were hit by missile attacks, sparking fires and causing extensive damage.
While shipments from the plant had already halted earlier this month due to the war, the latest strikes threaten to keep gas prices high in Europe and Asia for longer.
Saul Kavonic, an energy analyst at MST Marquee, said: “The attacks on Ras Laffan could cause a long-term global gas shortage.” He added: “It’s (the attack) significant because even after the war ends, the impact on supplies could persist for months or even years, as repair work is carried out and replacement parts are sourced.”
Sharp rise in prices and expectations of extended disruptions
European gas contracts have already risen by more than 70 percent since the start of the Iran war late last month, while Asian LNG futures contracts have jumped by 88 percent.
US futures, which are usually insulated from global price volatility as a major exporter, also rose by up to 6.3 percent in early trading on Thursday.
The impact on global gas markets will become clearer when European gas contracts open at 3 p.m. Singapore time. Given that the plant was already offline, the effects may be distributed across the futures curve.
Short-term contracts have risen, but an extended outage will put upward pressure on prices through summer, winter, and possibly into next year, according to traders.
Threat to global supplies and widening crisis fallout
The outage at the Ras Laffan facility rapidly tightens the global LNG market, which was expected to move into surplus this year with the start of new projects.
This situation threatens shortages in financially strained developing nations like India and Bangladesh, as well as a slowdown in industrial activity and higher energy bills from the UK to Japan.
The Ras Laffan Industrial City covers an area of 295 sq. km, roughly one-third the size of New York City.
In addition to LNG processing, it also houses other gas-related facilities, including a gas-to-liquids plant, LNG storage facilities, condensate splitting units, and an oil refinery.
QatarEnergy stated that an attack on Wednesday evening damaged the GTL facility, while LNG equipment was hit in a second attack on Thursday morning.
Hormuz crisis isolates the site
The site is effectively isolated from the rest of the world due to restrictions on oil tanker movements through the Strait of Hormuz following US and Israeli strikes on Iran.
Production operations at Ras Laffan had already been halted earlier this month after an Iranian drone attack, prompting QatarEnergy to declare force majeure on shipments and leading buyers to scramble for alternative supplies.
The Ras Laffan LNG facility accounted for approximately 19 percent of global LNG exports in 2025, according to ship-tracking data compiled by Bloomberg. Its shipments also represented more than a fifth of total gas consumption in India, Taiwan, and Pakistan, according to Energy Institute data.
